Midas Mulligan

Please Close the Markets

"I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale."

Thomas Jefferson
1816

Alas, what would President Jefferson think of a "swindle" on the order of $700 billion to preserve these fine, modern-day banking establishments ?

Why This Bailout Can't Work - And What Will

An excellent column, with a likely correct solution --- a solution which, unfortunately, will never be implemented either whole or in part. An Obama Regime, aided by an increased Democrat majority in Congress under Pelosi, Frank, Dodd, and Reid, will not only see to that, but will in all likelihood take the traditional liberal tack, and essentially go the other way entirely ( i.e., increase Government spending, raise taxes on income, capital gains, etc. ).

It's a Bull Market in Government Intervention

What with the proposed "Resolution Trust" clone and money market fund backstopping ( not to mention the FNM and FRE rescues ), it now appears that the "bazooka" analogy has come up a bit light, in terms of "throw weight." In light of the estimated cost of "TARP" for the beleaguered taxpayer -- some half trillion dollars -- the Treasury has upgraded the deployed weapons system from the conventional bazooka to a squadron of LGM-30G Minuteman III's.

$500 billion. Devastating throw weight indeed.

Are We There Yet? Not Even Close.

I completely agree with Mr. Sunshine's [ past and current ] comments, and would add that even if the "60 day" stress test passes without another financial sector calamity, the outcome of the national election could very well provide the shock for the next leg down: Democrat hegemony -- and a lengthy leg down it shall be.

Equities: In the Eye of the Storm

Re: Contributor wyosteven

You make several salient points. The greatest transfer of wealth in the history of this nation has been from the "Greatest Generation" ( those who fought and won the Second World War ) to their children, the "Baby Boomers" so-called. These " 'Boomers," however, have not quite been spending or making policy over the past thirty years. Indeed -- the "yuppies" ( thirty-somethings ) of the 1980s are the very same people. It is their children, unfortunately, who are now feeling the brunt of the housing bubble "pop," increasingly tighter credit, and a future filled with tax increases to pay the Government "benefits" of the retiring-en masse " 'Boomer" generation.

"Let the snake go" indeed. Such action, however, takes considerable political courage and will -- two things sorely lacking in the current political sea, regardless of party.

The Great Consumer Crash of 2009

Well done. A thorough, well-researched article. I would dispute the author's suggestion, however, that the penurious and prudent will emerge relatively "unscathed." Those ( or perhaps, "we" ) who invest will likely experience a degree of "collateral damage" of a kind, in terms of meandering or lower indexes ( lower equity prices ), resulting from a consumer-led slowdown of undetermined depth and breadth.

"May you live in interesting times," the old Chinese admonition goes. Investors are headed for some interesting times indeed.

Fear of Higher Taxes a Cause of Sell-off

Well done, Anton. Very little commentary has addressed the deleterious effect which higher taxes under an Obama regime would have upon industry.